2010 (3) TMI 576 - AT - Customs

Computer Monitors - Flat Penal display for electronic data processing machine and Plasma Monitor for computers. Exemption claimed. Held that - these were classifiable under Heading 84.71 of Custom tariff Act 1975 and not under Heading 85.31 or 85.28. They were not entitled to benefit of Notification No. 21/02-Cus. As Srl. No. 325 of table annexed to it covered Flat Panel Display of a kind used with Automatic data Processing machine or telecommunication apparatus classifiable under sub-heading 8531.80. Penalty - held that - no misdeclaration which could render goods liable to confiscation importer is not liable to penalty. It was more so as in statements/admission of importers there was no evidence of misdeclaration.

Issues Involved:
1. Eligibility of the imported goods for concessional rate of duty under Notification No. 21/02-Cus. (Srl. No. 325).
2. Liability of Shri Pradeep Khanna, proprietor of M/s. Sounds Terrific, for penalty under Section 112(a) of the Customs Act, 1962.
3. Liability of Shri J.S. Marwah, proprietor of M/s. J.D. Enterprises, for penalty under Section 112(a) of the Customs Act, 1962.

Detailed Analysis:

1. Eligibility of the Imported Goods for Concessional Rate of Duty:
The primary issue was whether the goods imported were eligible for a concessional rate of duty under Notification No. 21/02-Cus. (Srl. No. 325). The declared description of the goods was "Flat Panel Display for Automatic Data Processing Machine" or "Plasma Monitor for computers," classified under headings 84.71 and 85.31. The Department contended that the goods were "Reception apparatus for television" classifiable under heading 85.28.

The Tribunal examined the scope of headings 84.71, 85.28, and 85.31. It was noted that video monitors for use with automatic data processing machines were covered under heading 84.71 during the period of dispute. The goods were found to be as declared upon examination by Customs. However, the exemption under Notification No. 21/02-Cus. (Srl. No. 325) was applicable only to Flat Panel Displays of heading 8531.80, which did not cover the imported goods classified under heading 84.71. Therefore, the goods were not eligible for the concessional rate of duty.

2. Liability of Shri Pradeep Khanna for Penalty:
The Tribunal considered whether Shri Pradeep Khanna was liable for a penalty under Section 112(a) of the Customs Act, 1962. The goods were described as "Flat Panel Display for Automatic Data Processing Machines/Plasma Monitors for computers," and this description was confirmed by Customs authorities. Since the goods were found to be as declared and there was no evidence of misdeclaration, the Tribunal held that Shri Pradeep Khanna could not be accused of misdeclaration. As there was no act or omission rendering the goods liable for confiscation, Shri Pradeep Khanna was not liable for a penalty.

3. Liability of Shri J.S. Marwah for Penalty:
Initially, two allegations were made against Shri J.S. Marwah: producing a forged AEPC certificate for duty-free clearance and misdeclaring the description of goods to avail concessional duty rates. The Commissioner (Appeals) had already dropped the forgery charge, and the Department did not appeal against this decision.

Regarding the misdeclaration allegation, the Tribunal found that the goods were as declared upon examination by Customs. The statements of the importers, which were cited as admissions of misdeclaration, did not categorically state that the goods were "Reception Apparatus for television." The Tribunal concluded that there was no evidence of fabricated invoices or false examination reports by Customs. Therefore, the allegation of misdeclaration and abetment of duty evasion against Shri J.S. Marwah was unsupported, and the penalty imposed on him was not sustainable.

Conclusion:
The Tribunal allowed the appeal filed by Shri J.S. Marwah, setting aside the penalty imposed on him. In the appeal filed by Shri Pradeep Khanna, the duty demand was upheld, but the penalty was set aside.

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